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People Buying Tablets Instead of Cheap PCs, Says Nvidia

By - Source: CNET | B 43 comments

Tablets are eating cheap PCs alive.

Thursday during a conference call, Nvidia Chief Executive Jen-Hsun Huang said that consumers are turning to tablets instead of purchasing cheap PCs, even more so now that Microsoft's own Surface tablet and Windows RT are now available on the market. He indicated that consumers are beginning to realize that a top-notch tablet with solid features is better than a cheap PC with sub-par components.

"These days, tablets are so versatile, transformable," Huang said. "Now with Microsoft Surface and Windows RT, the distinction between a tablet and a cheap notebook has all but disappeared.... The future of cheap PCs is tablets."

He went on to note that Nvidia's own tablet business has doubled from the previous year, and its overall SoC business grew 50-percent in the same timeframe. The company is now expecting to ship some 30 million Tegra chips in 2012 alone. Even more, mobile chips like Nvidia's Tegra will likely take overall computing share from the low-end PC market.

"Windows RT is a monumental event for the PC industry," he told CNET in an interview. "This is really about making the PC modern, because now it's transformable into a tablet as well as being a full PC. And it's incredibly mobile. The battery life is fantastic. Industrial design is fantastic. Windows RT is really about creating the modern PC. Once you touch it, feel it, enjoy it, you realize in just a few clicks that this is going to be the way PCs get built."

Thanks to Windows RT, Nvidia is entering the Windows desktop arena not with the launch of a new GPU (which typically isn't offered in low-end PCs due to their cost), but as an ARM-based chip supplier with processor and GPU cores crammed in a single, centralized solution. The company is now on the same playing field as Intel and AMD who also offer low-power solutions for mobile computing.

"Our view of the PC [total addressable market] is it's being eaten by tablets," Huang said.

On Thursday Nvidia reported record revenue of $1.20 billion for the third quarter of fiscal 2013 which ended October 28. Revenues were up 15.3-percent from the previous quarter, and up 12.9-percent from a year earlier. This may be partly due to an increased number of Tegra chips being used in the second half of 2012 thanks to Google's Nexus 7 and other Tegra 3-based tablets and mobile devices.

Nvidia said that revenue is expected to be between $1.025 billion and $1.175 billion in the fourth quarter of fiscal 2013. GAAP and non-GAAP gross margins are expected to be flat relative to the prior quarter, 52.9 percent and 53.1 percent, respectively. GAAP operating expenses are expected to be approximately $400 million; non-GAAP operating expenses are expected to be approximately $359 million.

 

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  • 21 Hide
    DjEaZy , November 9, 2012 8:34 PM
    ... not in developing countries... with a cheep pc you can be more productive...
  • 15 Hide
    neo_moco , November 9, 2012 9:20 PM
    soldier2013Meh I rather game on my desktop at 2560 x 1600 all ultra settings, mouse and keyboard any day over a tablet. Everything else I do on my "phablet phone" the Galaxy Note and soon the Note 2.

    They are talking about a cheap pc in like 200-300$ ... you are talking about a 1000$ pc without the v.expensive 2560x1600 display.
  • 14 Hide
    drwho1 , November 9, 2012 9:07 PM
    "He indicated that consumers are beginning to realize that a top-notch tablet with solid features is better than a cheap PC with sub-par components."

    ... my best guess is that most readers here don't buy cheap PC's either.... most of us simply build our own systems so that we can choose exactly which components do we want on our PC's.

    .. just a thought...
Other Comments
  • 21 Hide
    DjEaZy , November 9, 2012 8:34 PM
    ... not in developing countries... with a cheep pc you can be more productive...
  • 2 Hide
    bystander , November 9, 2012 8:41 PM
    Clearly Nvidia is excited about Windows RT allowing them to join the PC CPU market (if you want to call Win RT tablets/convertibles PC's).
  • 9 Hide
    MaXimus421 , November 9, 2012 8:43 PM
    Good, maybe PC hardware will get cheaper...
  • 7 Hide
    bigshootr8 , November 9, 2012 8:45 PM
    The primarily reason they are selling well is because for most things you can get away with just using a tablet put microsoft office on a tablet and add the ability to use a keyboard and boom cheaper then a laptop and does the same sorts of things.

    For games, editing, rendering, photo work, business's you will still need a desktop of some kind but yea I don't think this surprises me in the least. If anything I wonder why Apple hasn't hit the 200 dollar mark the ipad mini isn't a whole lot closer to that client who wants a cheap tablet like the kindle, nook, and nexus.
  • -8 Hide
    basketcase87 , November 9, 2012 8:45 PM
    DjEaZy... not in developing countries... with a cheep pc you can be more productive...

    You can easily be just as productive on tablets that are designed to provide that kind of functionality (i.e. Surface, ASUS Transformer tablets).
  • -5 Hide
    Anonymous , November 9, 2012 8:57 PM
    Meh I rather game on my desktop at 2560 x 1600 all ultra settings, mouse and keyboard any day over a tablet. Everything else I do on my "phablet phone" the Galaxy Note and soon the Note 2.
  • 0 Hide
    Anonymous , November 9, 2012 8:59 PM
    From a company that is not building Cheap PCs of any Kind, but is in tablets, sure they are going to downplay the cheep PC, even if you can get a cheep PC for arount $300-$350 that does more than a tablet that costs 500 or more! Most of the people buying tablets already own a pc, I own 3 laptops! I will not pay any more than $200 for a tablet! Anyone that expects to do anything on a Windows RT tablet, can expect to pay for any software on this closed ecosystem, but with the cheep laptops in the $300 to $350 range users can install all the open source software for free, such as Libra or Open office, gimp, and Blender! As for my laptops, none of them cost more than $550, and the latest one I own came with a Sandy bidge Core i7, and I still get more than 6 hours of battery life on it! People rarely need more than 6 hours of battery life on their devices, as Airports, airplanes, and trains all have power outlets! Most people in the coffee houses that are on Tablets, have the tablets plugged in, so power is not the issue It once was! I will be running windows 7 on my laptops, and I have no need to upgrade to Windows 8! Until tablets have the ability to run a full version of a desktop operating system, expect Android based Tablets to be the best deal for under $200.
  • 14 Hide
    drwho1 , November 9, 2012 9:07 PM
    "He indicated that consumers are beginning to realize that a top-notch tablet with solid features is better than a cheap PC with sub-par components."

    ... my best guess is that most readers here don't buy cheap PC's either.... most of us simply build our own systems so that we can choose exactly which components do we want on our PC's.

    .. just a thought...
  • 6 Hide
    Solandri , November 9, 2012 9:14 PM
    bigshootr8The primarily reason they are selling well is because for most things you can get away with just using a tablet put microsoft office on a tablet and add the ability to use a keyboard and boom cheaper then a laptop and does the same sorts of things.

    Just the cost of a "cheap" mobile Intel CPU ($200), and Windows ($80) and Office ($100) are enough to make the laptop more expensive than most tablets. The Microsoft and Intel taxes are a millstone around the low-end laptop industry.

    That's why tablets have overrun the low-end laptop market IMHO. Dollar for dollar you can get better hardware (certainly a better screen) with the tablet. The ARM CPUs may not perform as well as an i3, but in most cases they're "fast enough." It's the same problem Microsoft and Intel faced with netbooks (which ran Linux on non-Intel CPUs before Microsoft made Windows Starter and Intel made the Atom processor). But I don't think they're going to be able to convert tablets into x86 devices running Windows this time around. The iOS and Android software markets have reached critical mass.
  • 1 Hide
    Wolygon , November 9, 2012 9:18 PM
    Quote:
    Now with Microsoft Surface and Windows RT, the distinction between a tablet and a cheap notebook has all but disappeared.... The future of cheap PCs is tablets.

    I think he may be confused with Surface Pro, in which case he doesn't make the chips.
  • 15 Hide
    neo_moco , November 9, 2012 9:20 PM
    soldier2013Meh I rather game on my desktop at 2560 x 1600 all ultra settings, mouse and keyboard any day over a tablet. Everything else I do on my "phablet phone" the Galaxy Note and soon the Note 2.

    They are talking about a cheap pc in like 200-300$ ... you are talking about a 1000$ pc without the v.expensive 2560x1600 display.
  • 0 Hide
    Yuka , November 9, 2012 9:41 PM
    Sorry, but no.

    Cheers!
  • 0 Hide
    Anonymous , November 9, 2012 10:07 PM
    My wife travels and does presentations one-on-one with clients. I just bought her a Lenovo Yoga 13 -- haven't received it yet. She loves the idea of doing presentations with it and then switching to notebook mode to get work done.

    Myself? I've tried the Windows 8 experience in a VM. Fun for all of 30 minutes, then I became progressively more and more angry every time that f*cking Start Window blocked my view to the desktop.

    There's value in the Windows 8 tablet interface for casual computing. It hampers working with multiple applications simultaneously. There's no way in hell I'm installing it as my primary OS on my workstation.
  • 1 Hide
    Usersname , November 9, 2012 10:25 PM
    I wrote on Tom's a few years back that Apple's tablet paradigm shift would destroy the bottom-mid-end Laptop/PC market... Of course, most here vehemently disagreed, and I got thumbed to oblivion.
  • 4 Hide
    Anonymous , November 9, 2012 11:34 PM
    CheepPCsAreTheBestValue, said:

    From a company that is not building Cheap PCs of any Kind, but is in tablets, sure they are going to downplay the cheep PC, even if you can get a cheep PC for arount $300-$350 that does more than a tablet that costs 500 or more! Most of the people buying tablets already own a pc, I own 3 laptops! I will not pay any more than $200 for a tablet! Anyone that expects to do anything on a Windows RT tablet, can expect to pay for any software on this closed ecosystem, but with the cheep laptops in the $300 to $350 range users can install all the open source software for free, such as Libra or Open office, gimp, and Blender! As for my laptops, none of them cost more than $550, and the latest one I own came with a Sandy bidge Core i7, and I still get more than 6 hours of battery life on it! People rarely need more than 6 hours of battery life on their devices, as Airports, airplanes, and trains all have power outlets! Most people in the coffee houses that are on Tablets, have the tablets plugged in, so power is not the issue It once was! I will be running windows 7 on my laptops, and I have no need to upgrade to Windows 8! Until tablets have the ability to run a full version of a desktop operating system, expect Android based Tablets to be the best deal for under $200.


    Tablets running windows RT are not the same as A cheep PC, RT is very limited Run Time(RT) and closed to non windows store apps, there are plenty of cheep(in Price) PC with good hardware on sale. Windows RT is so limited, Do you see any open source software being offered on the current surface, no , only a PC can run the full verson of windows Any RT tablet will be limited, and for 500+ you can get a damn good ASUS or other low priced (not Cheep) PC, That can run circles around the surface! Value PCs beat any RT device hands down! The microsoft surface tablet keyboard covers are very Cheep and poorly constructed!
  • 0 Hide
    bystander , November 9, 2012 11:54 PM
    @YesYouRight

    Since the Surface comes with Office (word, power point, excel) and all the basic software for general computing, you already have more software than most people will have on their cheap PC. There is no need for more, for a lot of people.

    That said, in the future, as companies get on board with the new UI, they will be building apps around .NET. These applications are portable to all Windows 8 systems. At least, this is what Microsoft's is planning for.
  • 4 Hide
    bllue , November 10, 2012 12:01 AM
    Most people would use a PC for skype, browsing, facebook , etc amyway. A lot of people don't require more than the basics, and a lot of tablets - especially the Surface - provide exactly what they need
  • 0 Hide
    InvalidError , November 10, 2012 12:05 AM
    soldier2013Meh I rather game on my desktop at 2560 x 1600 all ultra settings, mouse and keyboard any day over a tablet.

    Most tablets either have a host or OTG USB port that enables people who really want to use their tablets with a keyboard, mouse or other external devices to do exactly that - though some of these may require additional software and a jailbroken device.
  • 1 Hide
    kinggraves , November 10, 2012 12:23 AM
    SolandriJust the cost of a "cheap" mobile Intel CPU ($200), and Windows ($80) and Office ($100) are enough to make the laptop more expensive than most tablets. The Microsoft and Intel taxes are a millstone around the low-end laptop industry.That's why tablets have overrun the low-end laptop market IMHO. Dollar for dollar you can get better hardware (certainly a better screen) with the tablet. The ARM CPUs may not perform as well as an i3, but in most cases they're "fast enough." It's the same problem Microsoft and Intel faced with netbooks (which ran Linux on non-Intel CPUs before Microsoft made Windows Starter and Intel made the Atom processor). But I don't think they're going to be able to convert tablets into x86 devices running Windows this time around. The iOS and Android software markets have reached critical mass.


    The power of a $200 Intel CPU would tear through the best tablet processors, not even comparable. A full version of Office isn't comparable in productivity to anything on a tablet either. You might as well be saying a Porsche is more expensive than your bicycle. Ultra cheap PCs can still be made with tablet level quality and power (ahem Chromebooks). An integrated Atom or AMD system is still better than Tegra and cheaper. You still have the option to drop a linux kernel on it for FREE and have a better OS than Droid/iOS. I can build an entire integrated system for under $300 that would still take a belt to a tablet any day of the week.

    So why did the "netbook" model fail? We're talking a consumer level here, netbooks weren't the ideal solution for home consumers. Tablets are better for media and content consumption, and that's what consumers need. They are more comfortable to use with simple tasks. Productivity is for work, they already have PCs at work to do their productivity. Tablets are not taking over the business sector. People are not typing 300WPM on a tablet. Sure, you can get a BT keyboard and type away on a tablet, but that isn't business friendly. Touch screens and bluetooth devices also come with their own "taxes". You can get a better productivity machine with a PC for cheaper than with a tablet, because the comfort premiums of a tablet do not increase productivity. They are two different devices with two different usages.

    Of course Nvidia would want to downplay the potential of a netbook device though. Cheap PCs are a business sector they have no part in. Their rivals at Intel and AMD are the ones involved with cheap integrated PCs.
  • 1 Hide
    atikkur , November 10, 2012 12:55 AM
    i still choose light notebook for my college needs, $250 pc is enough. tablet is not that great for multitasking.
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